Against the sobering backdrop of daily life, Bitcoin (BTC) is lighting up the sky. After plunging 40% in September in reaction to Chinese market restrictions, BTC rebounded sharply, doubling over the past month to a new record high above $5800. Is Bitcoin in a bubble? Is it part of a Ponzi scheme? Our answer is NO to both concerns.
Bitcoin is soaring because it is the leading edge of a new financial paradigm. Will the government shut it down? In my opinion, it’s beyond their control. But to be frank, no one really knows for sure.
I admit to being very skeptical about BTC in 2010, up until a trio of recent encounters with individuals convinced me that cryptocurrencies may be the most important investment opportunity of the century.
Bitcoin’s volatility makes it an ideal vehicle for trading. We have strong signals as to where it’s going in the intermediate-term, specifically: it appears to be heading a thousand dollars higher before entering another significant correction, to the lowest price you will ever see in the future. That’s where you will want to buy it, because we expect its next move to be a triple into early-2018.
The information we’re receiving is so logical and convincing that we’ve initiated a weekly advisory newsletter on which to record our observations and recommendations. We’re offering the letter free throughout the month of October. The next issue will go out 10/18. To get on our distribution list, send an email to [email protected].
Healthcare turnaround. The President stuck a knife in the Obamacare turkey, signing an executive action expanding access to association health plans and health reimbursement accounts. These Rand Paul ideas are mostly a waste of energy… Then Trump defied leaders of both parties and twisted the knife by issuing a stop-payment order on health care subsidies, which WAS a BIG DEAL! Government payments to insurers to support lower copays and deductibles for people with modest incomes was an illegal Obama ploy, and Trump simply tossed the issue to Congress—to see if it dares to authorize the payments.
Health insurance stocks plunged and Democratic Attorney Generals from 18 states announced the launch of an uphill battle to recover the payments. Insurers for Affordable Care policies will now have to either hike premiums (an estimated 20+%) or leave the individual insurance market altogether. Bottom line, Trump is negotiating, using his executive powers to bring the “repeal and replace” issue to a head.
The people’s rebellion. A revolution of sorts is underway. In a reaction against Hollywood, mainstream media and the institutional left, a record number of TV subscribers are cutting the cord, even as MSM subscribers pull the plug. House Freedom Caucus Chair Mark Meadows told Voters Value Summit participants that Congressional members who don’t get behind Trump’s “America First” agenda should be sent home.
Breitbart Chair and former White House Strategist Steve Bannon plans to do the work, declaring a “season of war” against the GOP establishment and warning Mitch McConnell “these folks are coming for you.” Bannon is recruiting participants for an attempt to replace as many House and Senate swamp rats as possible in 2018 elections. Lindsey Graham told CBS that Bannon is right: “If we don’t cut taxes and eventually repeal and replace Obamacare, then we [the GOP] are going to lose across the board in the House in 2018 and all of my colleagues running in primaries in 2018 will probably get beat.” Bannon, incidentally, is predicting that Trump will win in a blowout in 2020.
European political turbulence. Catalonian leaders are facing off against the Spanish government. So far, the Republic of Catalonia has achieved independent status for six seconds. It’s an extremely complicated situation and Spain has threatened to take over the region by force unless demands for independence are withdrawn by 10/19. Spain is already broken and events appear certain to get even more interesting in the region that sparked the 1936 Spanish civil war. And interestingly, Belgium Prime Minister Michel just came out against Spain, asking how it is that Europe is accepting migrants under the guise of standing for human rights, while at the same time oppressing dissent among its own people.
A new European Union nightmare may result from the Austrian election victory of 31-year old Sebastian Kurz, whose People’s Party (OVP) is expected to form a coalition with the right-wing populist Freedom Party (FPO). The OVP is tough on migration, easy on taxes and widely Eurosceptic.
False flag stories about the shooting in Las Vegas include proof of a second shooter, loose ends and lots of questions. And this fascinating report about an eyewitness who posted an account of her experience on Facebook, and then mysteriously died 5 days later… Finally, George Soros’ Investment Fund bought 1.35 million “puts” on MGM stock 60 days before the attack at MGM’s Mandalay Bay.
Chicago’s soda tax fizzled, as Cook County officials repealed it by a 15-1 vote after an outcry from residents and small business retailers who said their soda sales crashed 90% after the ban went into effect.
MARKETS – for the week ending October 13
Real money rose: gold $30 to $1305/ounce and silver 62-cents to $17.41/oz.
US stocks closed higher: the Dow up 0.4% at 22872 and the S&P up 0.2% at 2553.
Mining stocks (the XAU Index) rose 0.4% to 87.29.
Crude oil (the WTIC Index) rebounded $2.75 to $51.45/barrel.
Commodities (GCC Index) gained 1.5% to 19.04.
Currencies. The Federal Reserve Note (= dollar, via USD Index) slipped 0.8% to 92.93.
Cryptocurrencies. Bitcoin continued climbing, posting a $1200 weekly gain, to a $5800 Saturday reading.
Wikileaks founder Julian Assange posted a sardonic “thank you” note addressing U.S. authorities who shut off Wiki’s access to Visa, MasterCard, PayPal, etc., which forced the whistle-blowing website to invest in Bitcoin in 2010—where it proceeded to log a 50,000% return.
US Treasury bonds bounced: 10-year and 30-year yields fell 9 and 10 basis points, respectively, to 2.28% and 2.81%. The yield spread between 30-year and 5-year Treasuries has fallen below 90 bps; the last two times this happened, the U.S. economy entered recession.
About the Author
Wayne Peterson is an independent Registered Investment Advisor and principal of Family Business Office, a comprehensive financial planning and asset management firm he founded in 1991. He has been publisher of the Transformation Watch newsletter since 2005. A U.S. Air Force Academy graduate, Peterson spent five years with the U.S. Marine Corps as a fighter pilot, followed by 20 years in aerospace management. For free weekly receipt of these financial blogs, subscribe here.
Peterson’s book, “But What If I’m Right?”, outlines the factors contributing to the impending global financial transformation and provides readers with recommendations to safeguard their families and their assets.